Businesses looking forward to Chinese reopening

VOV.VN - China’s recent decision to reopen its market in early January is anticipated to have a positive impact on local businesses which export commodities to the northern neighbour.

China is gradually moving to ease domestic COVID-19 prevention measures, announcing that it will open its borders from January 8 and may fully open its economy moving forward in the second quarter of the year. The move is expected to not only have a positive impact on businesses that export goods to this lucrative market, but also to ease pressure on the supply chain of many manufacturing industries.

Seafood is widely considered to be an industry that is set to greatly benefit from China opening its market. Indeed, seafood exports to this market have still grown over the past two years, despite the tightened quarantine policy. Therefore, the Vietnam Association of Seafood Exporters and Producers (VASEP) expects Chinese consumption demand to continue to rise when travel restrictions are relaxed, with export turnover forecast to increase further over the coming year.

“Some of our experts will enter China to have an assessment and forecast for this market,” says Truong Dinh Hoe, general secretary of the VASEP. “Last year, this market brought in US$1.6 billion in export turnover, and the figure for 2023 is predicted to be higher,” he adds.

Not only is China the largest consumption market, but it is also an important link as part of the global supply chain. Therefore, its decision to reopen its market is also expected to help solve bottlenecks which have impacted the supply of raw materials, especially components, machinery and equipment, and textiles in the production chain.

Yutaka Watanabe, general director of Towa Industrial Vietnam, points out that COVID-19 has placed a strain on the process of raw material, primarily because of bottlenecks it created in the supply chain.

“China is still a leading supplier of materials for many factories around the world, meeting the quantity criteria, quality and price. When the price of raw materials is better, the price is also more competitive,” says Watanabe.

However, many businesses with partners operating in the Chinese market say they have not received official documents from their partners regarding market opening, meaning now they are forced to wait.

“For firm that are doing business with the Chinese market, they keep a close watch on this Chinese move. Even recently, there are new regulations on brands and technical quality of goods, businesses have to update and keep up with the regulations,” says Ly Kim Chi, president of the Ho Chi Minh City Food Association.

According to VNDirect’s forecast, China’s opening will be one the biggest driving force behind the growth of export output of businesses operating in the seafood, textile, and rubber industries. In particular, firms with a large proportion of revenue and market share in this market are the ones that will enjoy the most benefits.

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